Revolving Doors

Lobbying for lucre in Kosovo, former US officials raise larger questions about conflict of interest rules

December 12, 2012
Obsession
Modern States
December 12, 2012
Tap image to zoom
NATO Supreme Commander Wesley Clark is welcomed in Kosovo in 1999; will he find a lucrative business deal there today?
NATO Supreme Commander Wesley Clark is welcomed in Kosovo in 1999; will he find a lucrative business deal there today?(AP Photo/Visar Kryeziu)

A flood of US officials bidding for government business in Kosovo originally helped liberate and rebuild the country following ethnic clashes in the Balkans during the nineteen nineties. Now, choosing between them has created a tricky situation for politicians there, the New York Times reports:

One bid is from a fund founded by former Secretary of State Madeleine K. Albright. Lobbying for another was James W. Pardew, the Clinton-era special envoy to the Balkans. Both former diplomats are among the Americans who hold the status of heroes here for their roles in the 1999 intervention that separated Kosovo from Serbia and created one of the world’s newest states.

… So many former American officials have returned to Kosovo for business — in coal and telecommunications, or for lobbying and other lucrative government contracts — that it is hard to keep them from colliding.

They also include Wesley K. Clark, a retired Army general and the former supreme allied commander of NATO forces in Europe who ran the bombing campaign against the Serbian strongman Slobodan Milosevic; and Mark Tavlarides, who was legislative director at the Clinton White House’s National Security Council.

While the unusually high regard for Americans in Kosovo makes it easier than usual for these ex-officials influence government decisions, the loose boundary between public officials and lucrative positions in the private sector still raises ethical questions around the world. Running a modern state, with its regulatory responsibilities and wide-ranging interactions with the economy, requires talented, highly-skilled individuals to administer. It’s hard to convince those people not to take lucrative jobs in the private sector after or before their time in government.

Especially in regulatory roles, governments need experts that can keep up with the private sector’s advances, and companies need experts who can navigate bureaucracies on their behalf. Sometimes, at least, the revolving door is seen as the solution to corruption, not the cause of it. HSBC, the global bank, negotiated a $1.9 billion deferred-prosecution agreement with the US government. Their lead negotiator? None other than Stuart Levey, the long-time Treasury lawyer who, until 2011, designed and ran the sanctions programs that HSBC violated. Levey came on board well after HSBC violated US law and having led settlement conversations with his former colleagues doubtless improved HSBC’s position. Today, his hiring is cited by the firm as evidence that they’ve cleaned up their behavior.

The bigger problem comes when former officials use their influence to lobby the government for new deals rather than cleaning up old messes. The US Congress has banned public employees from lobbying their former colleagues for a year, but has no restrictions on lobbying foreign governments they may have worked with in an official capacity. Given the US’s reach into the world economy, there are plenty of opportunities for officials to bend (or break) ethical rules; the same issue applies in developed countries around the globe (see Tony Blair’s trip to pre-revolutionary Libya on behalf of JP Morgan). Emerging markets have plenty of money flowing in and far more lax rules around officials mixing public and private business, so they  have less incentive to leverage their public service abroad, though that may change as the BRIC countries take a larger role in global affairs.

Top News

Powered by WordPress.com VIP
Follow

Get every new post delivered to your Inbox.

Join 26,413 other followers